The statement, submitted the House Committee on Ways and Means and the Working Group on Pensions and Retirement, addresses budget provisions that would cap the total amount of savings an individual can accumulate in tax-favored retirement plans and limit the value of exclusions for employee deferrals in 401(k) plans.
"At a minimum, the proposals will increase the costs ultimately borne by all American workers trying to save for retirement, not just the higher-income workers whom the provisions target,” said Larry Goldbrum, general counsel of The SPARK Institute. “At worst, the proposals will adversely impact the availability of plans and the amounts contributed by employers, particularly among small businesses."
The SPARK statement expresses concern about the complexity that the proposed savings cap would add to the administration and operation of all retirement plans. According to Goldbrum, "Although the proposed cap on its face may appear to only impact higher-income individuals, it will have implications for everyone who saves for retirement. The administrative, compliance and reporting costs resulting from it will ultimately be borne by all individuals trying to save for retirement, not just higher-income workers."